Last week, it was announced that the European Commission plans to impose anti-dumping levies on solar panel imports from China.
China is the largest manufacturer of solar panels, exporting £18 billion worth to Europe in 2011 but is currently selling photovoltaic solar panels for less than it costs its European rivals to build them. Mr Karel De Gucht, EU trade commissioner, has said that the Chinese panels being sold in Europe should cost 88% more than what they are currently sold at. This makes it understandably difficult for European manufacturers of solar panels to compete so the European Commission plans to make it a fairer market by adding duties to Chinese imports.
The duties will be phased in, starting last week on Thursday 6th June. For now, the duties are going to be 11.8%, much less than originally proposed, but if no compromise can be found after two months, the duties will reach an average of 47.6% and will remain for five years if the dispute is not resolved. This has sparked some concerns that a wider trade war with China could result from this levy, if enforced in full.
Should these levies be introduced into the solar trade, it could spell the end of a booming trade. A considerable increase in manufacturing costs will, in all likelihood, be passed on to the consumer, meaning the price of solar panels could dramatically increase. This would, in turn, increase the payback period from investing in solar technology (the time it takes for one to recoup their investment through money earned & saved from having solar panels installed), making the prospect of investing in solar much less compelling.
The costs and benefits of buying solar panels in the UK has had a varied past – there was an initial boom with the Government’s Feed-in-Tariff, which offered you approximately 45p per unit of electricity you sold back to the grid, but the Government deemed this unsustainable. This recently changed , effectively halving the money earned from solar, which means the payback period is a bit longer. However, the cost of solar panels has dropped in last couple of years which has improved the return on investment, making it a worthwhile investment once again. Now we may be set to go back the other way in light of these latest proposed changes.
With the country targeting lower carbon emissions and promoting more energy efficient living, these potential price increases could make it even more difficult for us to achieve this. And whilst this proposed European levy would be good news for manufacturers, the resulting price increase could see many smaller installation firms go out of business if consumer demand is stifled.
With all this uncertainty in the market at present, if you are considering investing in solar panels, now might be the time to buy before any of these changes come about. Anglian currently has 10% off its photovoltaic solar panels, so be quick and take advantage of our fantastic offer!